That’s the question I often ask people when they
want my opinion about some financial advice they’ve heard. Here are some of the
things “they” say:

● Getting student loans is a good thing because it’s
an investment in your future.

● Now’s the time to get a home because interest
rates are low.

● Never pay off your mortgage, or you should keep a
mortgage for the tax break.

● It’s better to pay off the debt by borrowing from
your 401(k) retirement savings account because you will be paying yourself
back.

My question about who “they” are often solicits
chuckles because people realize that in their effort to help themselves,
they’ve picked up pieces of advice from biased individuals or without doing the
work to figure out if it’s prudent.

Millions of consumers have been duped by people —
many once touted as icons — who turn out to be charlatans or who gave advice
that they themselves didn’t follow, says Zac Bissonnette, a personal finance
writer.

Time and again, we learn that self-help authors have
become wealthy not by following their own advice but by selling the concept of
a certain life or financial enriching strategy. We’re reminded that politicians,
corporate and religious leaders, entrepreneurs, sports figures and relationship
experts are not practicing what they preach.

I couldn’t stop shaking my head as Bissonnette took
me down memory lane, starting with the financial arena.

Remember the Beardstown Ladies?

They were part of an investment group from
Beardstown, Ill., who wrote the bestselling “The Beardstown Ladies’
Common-Sense Investment Guide: How We Beat the Stock Market and How You Can
Too.”

Along with some recipes for stew and chicken, we
were told that from 1984 to 1993, the ladies had an average annual investment
return of 23.4 percent. Their book sold almost 800,000 copies.

But some number-crunching from journalists and an
eventual audit found the ladies hadn’t beaten the market or most money
professionals. Their actual return during the time period had been 9.1 percent,
compared with the 15.7 percent average annual return on the Dow Jones
industrial average.

The women said it was a miscalculation. Their
publishing company was sued. There was a settlement and now we have a good lesson
about the importance of vetting people’s investment claims. While you can learn
a lot in an investment club, “the ladies would probably be better off if they’d
just put their money in time-proven mutual funds,” Bissonnette writes.

In the not-so-distant past, we had the falling of
another “they” in Bernie Madoff. The once-prominent member of the securities
industry and former chairman of Nasdaq is serving a 150-year prison term for
bilking investors out of billions.

“And yet, when he actually took a moment to give
personal finance advice after his fall from grace, he provided wisdom that
everyone should follow: low-cost index mutual funds are the best option for
most investors,” Bissonnette writes.

Bissonnette also introduces Angelo Mozilo, the former
chief executive of Countrywide Financial. Although the company was approving
risky home mortgages, in an e-mail that Bissonnette points out, Mozilo wrote
that the no-money-down subprime loan is “the most dangerous product in
existence and there can be nothing more toxic.”

But many borrowers listened to the “they” who said
homes would increase in value exponentially so that they could refinance out of
the risky loans Mozilo and others were peddling.

Then there is the story of Jesse L. Jackson Jr., the
former Democratic congressman from Illinois who is serving prison time for
using $750,000 in campaign funds for personal use, including buying Michael
Jackson memorabilia.

Bissonnette pulls out this quote from a book Jackson
wrote with his father, the Rev. Jesse L. Jackson: “Living above your means is
financial sin.” Their book was titled “It’s About the Money! How You Can Get
Out of Debt, Build Wealth, and Achieve Your Financial Dreams.”

Says Bissonnette, “All too often, America’s smiling,
inspirational prophets turn out to be comically — and sometimes darkly —
horrible at following their own leads.”

I’m sure plenty of people might take issue with some
of Bissonnette’s selections of “bad people.” But his book will at least make
you pause before you start a sentence with, “They say.”

I’ll be hosting a live online discussion about “Good
Advice From Bad People” at noon Eastern on May 29 at
washingtonpost.com/discussions. Bissonnette will join me. Let’s talk about the
advice you took that turned out to be bad.

Readers may write to Michelle Singletary at The
Washington Post, 1150 15th St. NW, Washington, D.C. 20071 or
singletarym@washpost.com. Personal responses may not be possible, and comments
or questions may be used in a future column, with the writer’s name, unless
otherwise requested. To read previous Color of Money columns, go to
http://wapo.st/michelle-singletary.